Check out this article:
http://www.sfomag.com/enewsletter/detail.asp?ID=6359
I can’t remember if you need to be a member, it just says that mortgage loan applications are up 18% from the same month last year and that interest rates on home loans fell.
The Treasury Secretary just returned from China, Chinese holdings of US treasury notes are stable thanks to their belief that the risk adjusted rate of return is very competitive.
http://www.msnbc.msn.com/id/20182528/
The Chinese, however are upset because they have been fixing their currency, the yuan, against the dollar for years, so that the trade deficit in the US will grow and the trade surplus enjoyed by China will grow.
http://www.investors.com/editorial/editorialcontent.asp?secid=1501&status=article&id=271465242819506
Yesterday, the Washington post reported that Freddie Mac and Fannie Mae requested that regulators allow them to carry more mortgage notes than is currently allowed.
Our hesitation to reprice mortgage notes with any degree of certainty is leaving the markets volitile, in my humble opinion now would be a good time to refinance your arms to 30 year fixed direct am notes, especially if you plan to hold your properties for more than years.
http://www.realestatejournal.com/buysell/mortgages/20070808-ip.html
Weew!!
Glad that’s over!!
Hey, ya know, that correction REALLY wasn’t that bad.
I’m on my way down to Florida to buy some pre-construction condos in MIAMI!!!
The news paper had an article written by a realtor who said I could NEVER lose buying down there!!!
Real Estate BUST??? AHHHH FOOOOIE
If you bothered to read any of the articles you would realize that your response is strangely irrelevant. I would just like to provide investor references instead of layman's hype and aimless predictions of bleak outcomes...see you in the soup line.
Nicely put Funder.
Interest rates are lower now than last year? Ooooooooooookay there. Funny I recall that Wells Fargo and a couple other lenders just recently raised their interest rates to about 8% for prime loans. Don’t remember the rates being that high last year. Did you even bother to read the above article that you posted? :banghead
Everyone advertising interest rates are still low…Okay lower than 1985 maybe… Last year I was getting NOO NO DOC rates at 7.5% max, now I can not even get a OO Stated under 9%. Brokers tell me, if you get under 10%, grab it.
I guess those 6.5% rates are for like 50% LTV OO loans with 800 FICO…
I read ALL those articles.
Do you really think that the press is getting REAL information on this collapse???
Let’s review…
2 months ago Bear Stearns…“Our funds are solvent, their exposure to sub-prime is contained, and we don’t see this speading to other markets”
2 possibilities here… 1) They lied. Flat out lied. or 2) they have NO IDEA how bad this really is and they CAN NOT VALUE THESE ASSETS!!! You guy’s pick, I don’t care. It’s like asking “would you like to step in front of a train or a bus???” Results= pretty much the same.
NAR forecast for 2007…"We see continued strength in all real estate classes with price increases of 4-6%. OH MY GOD!! I’m not even going to bother with that one. You guy’s have at it.
Our beloved FED chairman last month…“While real estate prices continue to come under pressure, sub-prime IS contained and the FED is watching developements there.” YEP, their WATCHING all right, they watched last month, they’ll watch next month, that’s ALL THEY CAN DO. Read this part CAREFULLY…
THE FED HAS NO CONTROL OVER LONG TERM INTEREST RATES!!!
The markets set those rates NOT the FED. Oh and long term rates ARE basically MORTGAGES. Now if your a banker and you’re seeing all your friends losing jobs, TRILLIONS of dollars, AND your bank is now the single largest REAL ESTATE owner in the market, how fast are you going to run out to loan MORE money to REI guy’s???And better yet, do you think they just might want a little more on the INTEREST RATE side of those loans??? Maybe??? throw in a bigger down payment too, Oh and credit??? You better be level 1, and it better be one hell of a STEAL price wise.
Naa, Rates are going down!!! Look it say’s so right here in this newspaper.
I read all your articles… I stand by my statement.
Pete, you didn't make a statement you spewed a lot of sarcastic anger, which is really unusual for you.
Homeslice, I know what Wells Fargo did, I'm not on this site for the friendly environment.
Yrush, I can't imagine that the lending climate in Florida is too accommodating, and I do believe that the NO DOC money is pretty well expensive by now, thank God.
My point is this: I have predicted earlier that inflation will occur. The only sensible way for this situation to shake out is for mortgage rates (especially to high risk buyers) to rise dramatically. Unfortunately, we are going to have to deal with fearful people doing a lot of stupid things in the meantime, and Wall Street and the FED are going to have to deal with that. Right now, the currency markets have already priced in a rate cut in October. Today, President Bush stated that he does not think that Freddie Mac and Fannie Mae should be allowed to carry any more mortgages. I think a rate cut right now is a terrible idea, but also a short term opportunity for people thinking on their feet. Refinance now, fixed 30 year, before the long term rise of interest rates and tightening of underwriting criteria.
Funder,
I agree with you, especially about the rate cut. They cut rates NOW and China has no choice but to unload and things get far worse.
You do make some good points.
It’s not hate, it’s frustration. Not with you in particular but with the entire financial mess. Contrary to the popular “We’re all gonna be rich because homes prices are going to fall” thinking that prevails in these forums. THAT is not going to be the case. This is going to cost ME and YOU MONEY! A LOT OF MONEY. In lost opportunity, loss of low cost financing, PANIC by home buyers. It’s bad, and getting worse.
Funder,
These articles should be manditory reading for most real estate investors. Thanks!!!
Knowledge is power. For those who see the big picture and aren’t in panic mode, they will see opportunities where others don’t. It’s a big country and not all markets are going to be adversely affected. There’s still plenty of capital in the market at very reasonable rates. I wonder how many investors today are figuring out how to reach it.
-H
yrush2000,
This past June I closed on a NOO property with a 5/1 ARM, 6.5% with 80% LTV. BTW, I went stated income, no asset verification; though, my credit scores were 750+
Before commenting, I’ll admit I haven’t read anything but the OP’s comments…
Loans were up last week because of what I call “pipeline transfer”—some notable lenders have fallen out in the last two weeks and the increased application activity is a result of transferring these dead loans to a live lender.
The recent political goodwill mission to China was to allay both fear (The USA’s), anger (The Chinese) relative to the possible devaluation of the Yuan (and USA trade sanctions to drive the message home)—And the Chinese have 900 Billion dollars in U.S. Treasuries as leverage…The economic slight of hand at play here is by devaluing the Yuan, the USA also devalues the trade deficit between the two countries.
Of particular interest/concern to the US, was why China had been the largest global net seller of Treasuries in both April (5.8 Billion) & May (6.6 Billion).
Could this lead to a larger diversification of China’s nearly 1,300 Billion Dollars in foreign reserves?
My fortune cookie says it will…
Regards,
Scott Miller